The Commodity Futures Trading Commission has released its first formal proposal to regulate prediction markets, representing a significant step for the industry.
The proposal details how the agency will assess event contracts for compliance with federal public-interest standards. This action follows the rising popularity of platforms such as Kalshi, Polymarket, and Crypto.com.
CFTC Chairman Mike Selig described the proposal as a framework that balances innovation and market integrity. Under federal law, contracts related to war, terrorism, assassination, illegal activity, and certain types of gaming may be prohibited if found contrary to the public interest.
I’m pleased to announce that today, the @CFTC is officially seeking public comment on a structured framework for evaluating the types of events that may underpin contracts traded on prediction markets.
This proposal would give the CFTC durable, transparent rules of the road to…
— Mike Selig (@ChairmanSelig) June 10, 2026
The proposal establishes a three-part review process and recommends a 90-day evaluation period for certain contracts. Regulators would determine if an event contract falls within restricted categories and whether it serves or harms the public interest.
The proposal is generally supportive of sports-related event contracts. The CFTC noted that sports markets may offer valuable information and price-discovery benefits, making them less likely to be considered contrary to the public interest.
The framework emphasizes flexibility, allowing regulators to assess emerging products using multiple factors instead of a rigid test. Officials believe this approach will better support innovation while managing potential risks.
The proposal will now enter a public comment period before a final rule is adopted. If implemented, it would establish the first dedicated regulatory framework for modern U.S. prediction markets.
🗞️ Read more in @WSJ 👇https://t.co/WqlTVdK3Br
— Mike Selig (@ChairmanSelig) June 10, 2026
Press Release: cftc.gov
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